Arbitrum-based DeFi Initiative Hope Finance Exploited of $2 Million

• Users claim that a Nigerian citizen carried out the fraud.
• A Cognitos official conducted an audit of the Hope Finance smart contract on February 13.

Users who had hoped to benefit from the decentralized finance (DeFi) initiative built on the Arbitrum blockchain lost $2 million. When the Hope Finance Twitter account posted a warning about the fraud on February 21, it was picked up by Web3 security company CertiK.

It’s hard to find out any information on the project at this time. In January 2023, the platform’s Twitter page announced its intention to issue a stablecoin named Hope token (HOPE), whose quantity will be algorithmically adjusted based on Ether’s market value.

Funds Sent Over Tornado Cash

Moreover, users’ claim that a Nigerian citizen carried out the fraud and sent over $1.86 million to Tornado Cash soon after the platform launched on February 20. According to a member of the CertiK team, the fraudster tampered with the smart contract’s settings, which caused money to be stolen from the Hope Finance genesis protocol.

A Cognitos official conducted an audit of the Hope Finance smart contract on February 13, per a tweet. There was a reentrancy attack potential and a wrong modifier. Although these issues were brought to Cognitos’ attention, ultimately the audit was deemed to have been successful for the smart contract code. Hope Finance informed its customers of how to access their staked cash using the protocol’s emergency withdrawal feature when the fraud was discovered.

Arbitrum is a layer 2 roll-up network that allows smart contracts on Ethereum to scale exponentially. Both Optimism and the other layer-2 protocol continue to process a growing number of transactions in the Ethereum ecosystem.

Recommended For You:

Dex Aggregator Dexible Exploited of $2 Million in Recent Hack